Monday Aug 10, 2026
Monday Aug 10, 2026
Monday, 10 August 2026 00:00 - - {{hitsCtrl.values.hits}}
CBSL FIU Director General
Dr. Subhani Keerthiratne
Sri Lanka’s private sector must ensure the country’s new beneficial ownership regime is effectively implemented as it prepares for a crucial international anti-money laundering (AML) review, Central Bank of Sri Lanka (CBSL) Financial Intelligence Unit (FIU) Director General Dr. Subhani Keerthiratne said.
Sri Lanka is currently undertaking a high-level national review and preparation process for its Third Mutual Evaluation on Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) by the Asia/Pacific Group on Money Laundering (APG). Dr. Keerthiratne said the assessment will examine not only the country’s legal and institutional framework but also whether the system is producing effective results.
Addressing a seminar on ‘Beneficial Ownership Compliance Under the Companies Act, No. 12 of 2025’ organised by Corporate Management Consultants, Dr. Keerthiratne said beneficial ownership transparency is the only Financial Action Task Force (FATF) recommendation where Sri Lanka remains non-compliant, making implementation of the new requirements a key priority ahead of the evaluation.
“Having the legal framework is not sufficient. We have to implement it,” Dr. Keerthiratne said.
She said FATF assessments consider whether countries can demonstrate that their AML/CFT frameworks are effective in practice, rather than simply whether laws and institutions are in place. Under the FATF framework, beneficial ownership transparency of legal persons and arrangements is assessed under Recommendation 24 and Recommendation 25, while effectiveness is measured through 11 immediate outcomes.
Dr. Keerthiratne said Sri Lanka’s Third Mutual Evaluation is being conducted by international assessors with support from the FATF and APG, with the assessment team scheduled to visit Sri Lanka in the last week of October and first week of November. The assessors will meet public and private sector stakeholders, including companies, to verify implementation of AML/CFT requirements.
She warned that Sri Lanka cannot afford another FATF grey listing, recalling that previous grey listings affected correspondent banking relationships, increased scrutiny from foreign financial institutions, and raised costs for businesses and individuals.
“When a country is grey listed, our correspondent banking relationship is at stake,” Dr. Keerthiratne said, adding that foreign financial institutions may impose enhanced due diligence, while borrowing costs, sovereign ratings, and foreign investment could be affected.
She cited an International Monetary Fund (IMF) study that included Sri Lanka’s previous grey listing episodes and found that foreign direct investment (FDI) declined by 7.6% in countries placed on the FATF grey list. She also referred to a separate assessment on Pakistan, which estimated a $ 38 billion impact on GDP from repeated grey listings between 2009 and 2019.
“As a country recovering from our recent economic crisis, the bottom line is very clear. We cannot go back to the grey list,” Dr. Keerthiratne said.
Explaining the need for beneficial ownership disclosures, Dr. Keerthiratne said Sri Lanka’s latest national risk assessment identified private limited companies as a concentration point for money laundering risks. She said authorities need to identify the natural persons who ultimately own or control companies to prevent corporate structures being misused for criminal purposes.
She referred to recent investigations involving advance payments for imports, where companies had allegedly sent substantial funds overseas without goods being received in Sri Lanka.
According to Dr. Keerthiratne, investigators found instances where companies involved were registered in the names of labourers, drivers, or other individuals, while the actual controllers remained hidden behind corporate structures.
“The real criminals are hiding behind these companies. We don’t want our companies to be owned or controlled by criminals. We don’t want our companies to be abused by criminals,” she said.
Dr. Keerthiratne said when investigators cannot immediately identify who controls a company, law enforcement agencies must spend time establishing ownership structures before pursuing the underlying offences.
“That is why we need to have beneficial ownership information of any company or trust in place readily accessible, readily available for our law enforcement agencies and other authorities,” she said.
While acknowledging concerns raised by Company Secretaries and other professionals over practical implementation challenges, Dr. Keerthiratne urged stakeholders to work with regulators to resolve issues.
“If it is so difficult, then I think with the Registrar, the stakeholders should find a solution,” she said.
She said the private sector has an important role in ensuring companies are not misused for money laundering, terrorist financing, or other criminal activity, adding that knowingly submitting or attesting false beneficial ownership information could result in personal liability.
